How much is council tax in London?

Your rent or mortgage is one thing. It’s going to be a big expense. But so, potentially, is your council tax, since it’s calculated based on the value of the property you live in.

Oddly, although London is one of the most expensive places to buy, with one of the highest costs of living in the UK, council tax isn’t always correspondingly expensive. We’ll explain why later on. But as a rule, wherever you decide to live in the capital, the council tax element of your living expenses is well worth checking out before you make a decision. Depending on what district you choose, it could be either affordable or a bit too much on top of all your other expenses.

If you’re interested in finding out the average council tax London has to offer, read on. We’ll explore what the highest council tax London costs, what the lowest council tax London costs, the council tax bands London offers and more. By the end of this article you’ll have a much clearer picture.

Calculating Council Tax in London

Council tax in London, as it is everywhere else, is collected by local authorities, usually monthly by direct debit. A house’s Council Tax band is based on its rateable value, so the more expensive the property is the higher the Council Tax band. You have to pay it whether you own your own place or rent. Your local council will have split the tax into bands based on property values in the past, which means the council tax you pay is based on your home’s market value at the time it was valued. For properties in England, council tax bands are based on what the property’s value was on 1st April 1991, with different dates for Wales and Scotland. In Northern Ireland council tax is called ‘domestic rates’.  

 You can find out how much your local authority charges for council tax London on the gov.uk website. And you can pin down the council tax band that has been applied to a property online as well.

 Sometimes there are discounts. If you’re the only adult living in a property, for example, you get a 25% reduction. People on certain benefits can also get discounts on their council tax, as can people with certain disabilities, some carers, and those who live in specially modified homes for the disabled. Second homes and empty homes sometimes qualify for a discount, including while serious structural repairs are being carried out and the place is empty.

 If you’re a full-time student and everyone else in your home is also studying full time, you get a 100% discount, paying no council tax. Your income matters. If you don’t earn much you might be able to pay less via the reduction scheme, something else you can check online. And if a place is left empty for too long, the council might make a premium property charge against the property, added onto the council tax bill. There are also discounts available:

 

  • If the place is condemned
  • If the property is repossessed by the lender
  • If it’s unoccupied because the person living there has moved somewhere else because they need special care
  • If you’re a student or foreign language assistants on the British Council programme
  • If everyone living there is aged under 18
  • If the place is home to someone with a severe mental impairment

 

With London rent and property values so high, London’s council tax tends to be higher than elsewhere in the UK.

Council Tax Bands London

As we’ve mentioned, a council tax band represents the market value of a property at a certain point in time. For London, as we said, your band represents the value of the place you’re living in as it was on 1st April 1991. The various council tax bands are used to figure out how much you pay. In London, just like the rest of the UK, the council tax bands London style fall like this:

  •         Band A: Up to £40,000
  •         Band B: £40,001 to £52,000
  •         Band C: £52,001 to £68,000
  •         Band D: £68,001 to £88,000
  •         Band E: £88,001 to £120,000
  •         Band F: £120,001 to £160,000
  •         Band G: £160,001 to £320,000
  •         Band H: More than £320,000

 

Sometimes council tax bands change. This can happen when the property has changed size, for example has been extended, or changed layout, for example a house being split into flats. The character of the building can lead to a change, as can a change in use, since council tax only applies to domestic buildings, not commercial ones. If you’d like to check your own council tax band, or look at the band a property you’re interested in falls into, you can do it here.

Cheapest Council Tax in London

Next let’s look at the lowest council tax London can offer. Westminster is an expensive place to buy a property in London, but the property prices aren’t reflected in the district’s council tax rates. While Westminster has the cheapest council tax in the city, it’s also wise to remember the district also comes with an extremely high cost of living and it costs a fortune to buy property there.

How come council tax rates London Westminster are so low? It is, after all, an extremely smart area and very central. When council tax was first introduced, the borough set an unusually low figure thanks to government measures to ease the introduction of the new tax. The limits placed on what the government could charge when the tax was first introduced were low, and they remain low to this day. Oddly enough, this means you can easily find yourself paying a lot more council tax outside the capital.

 Other low council tax areas in London are Wandsworth, Hammersmith & Fulham, Kensington & Chelsea, and the City of London itself. The remaining ten lowest council tax rates all fall into Scotland, where council tax is usually cheaper than the rest of the UK.

Most Expensive Council Tax in London

So what’s the highest council tax London offers? Outside London, some of the most expensive council tax rates fall in Nottingham, Lewes in Sussex, Newark and Sherwood in the East Midlands, and Hartlepool up in the north east.  As far as council tax in London is concerned, Kingston-upon-Thames has the most expensive council tax of all, closely followed by Harrow, Richmond-upon-Thames, Havering and Croydon. The difference can be dramatic, which could mean you find living in a town outside the city might be a better bet, even taking into account the commuting costs.

Now you understand council tax rates London

Now you have a picture of how much is council tax in London. Isn’t it good to know it isn’t the most expensive in the UK, even though many London property prices are sky high? The top ten highest council tax rates are all outside the capital, which might mean living in London might be within easier financial reach than you imagined. Can we help you track down the perfect place to live in the nation’s fabulous capital?